Redbox Instant by Verizon, the joint venture between the DVD rental kiosk firm and the telecom giant, on Wednesday announced a content deal with Epix and an $8 per-month price for its soon-to-launch service.
The service, which will compete with Netflix, is expected to have its commercial launch late in the first or early in the second quarter.
The Redbox Instant by Verizon beta service will launch later this month with the $8 price tag, it said. For $9, customers can opt to redeem credits for rentals on Blu-ray Disc at kiosks.
Customers can also use Redbox Instant by Verizon without a subscription and pick from new releases available for purchase or rental.
Epix, a venture of Viacom, Liongate and MGM, will be a key content partner.
Electronic sell-through and VOD rental agreements are also in place for new releases from Lionsgate, NBCUniversal, Paramount Pictures, Relativity and Sony Pictures Home Entertainment, the firm said. Plus, Redbox Instant by Verizon also previously announced a content licensing agreement with Warner Bros. Home Entertainment.
Shares of Coinstar, Redbox's parent company, rose 2.3 percent on Wednesday to $51.96 while Verizon shares rose 1 percent to $44.79. Even Netflix shares ros 5.4 percent Wednesday as investors shrugged off what they considered old news about a soon-to-launch competitor.
The surge in Netflix shares, which came on heavy volume, was so counterintuitive that analysts were weighing in with reasons.
The Motley Fool, for example, listed several reasons Netflix shares didn't fall on Wednesday: the news was expected; Epix is a major "get" for Redbox and Verizon, but not a "differentiator;" and Amazon.com offers service similar to Netflix and what Redbox and Verizon will offer, but it hasn't harmed Netflix's business.
“We are building a compelling entertainment choice through our ability to support both physical and digital distribution of movies that people love, made possible by the depth of relationships we’ve established with top Hollywood studios and distribution partners,” said Shawn Strickland, CEO, Redbox Instant by Verizon.
“Redbox Instant by Verizon will be an exciting new service for consumers in the digital entertainment marketplace, and we are thrilled to be their partner, providing our movies from some of the world’s leading studios,” said Mark Greenberg, president and CEO of Epix. “We have a long and successful relationship with Verizon FiOS, which was our first distribution partner at the launch of Epix, and we are excited to build on that relationship with Redbox Instant.”